Gearing Up for New GSE Buyback Rules
An Inside Mortgage Finance Webinar
Recorded Oct. 24, 2012
After battling a tidal wave of repurchase demands from Fannie Mae and Freddie Mac for the past several years, the mortgage industry may finally be getting some relief. The Federal Housing Finance Agency has unveiled a representations and warranty framework aimed at clarifying—if not reducing—the buyback risk on mortgages sold or delivered to Fannie and Freddie after January 1.
What will the new buyback rules look like? How will they change the way Fannie and Freddie evaluate and review mortgage sales? And will the new reps and warranties changes encourage lenders to loosen mortgage underwriting overlays? Find out at a special Inside Mortgage Finance webinar, an event you and your firm can't afford to miss.
Unfortunately, buyback activity is showing no signs of letting up in 2012. According to numbers compiled by Inside Mortgage Finance, lender repurchases of mortgages sold to Fannie Mae and Freddie Mac climbed to a huge $5.4 billion in the first half of 2012. And another $12.43 billion in buyback requests were pending. But in a positive development, Fannie and Freddie withdrew a sizable $6.22 billion in buyback requests during the first six months of the year.
Hear from top Fannie Mae and Freddie Mac executives on what triggers buyback requests and how the GSEs review and sample mortgages. Importantly, learn what you can do to minimize or eliminate buyback risk on new mortgages sold to Fannie and Freddie.
Under the new framework, lenders will receive buyback protection on many mortgages after three years of performance. Also, a new buyback appeals process is being developed. But the new policy comes with a stepped up quality control sampling and review of new mortgages during the first 90 days.
Learn from an FHFA official exactly how the new buyback framework will work and what the changes could mean for Fannie's and Freddie's customers in 2013.
Order this webinar recording to also hear noted legal expert Larry Platt share comments on the new buybacks protocol.
Among the questions our expert panel addressed:
- How much hazard lies in the misstatement and misrepresentation clauses?
- Will there be more consistency about repurchase exposure and timelines?
- Should the framework help loosen credit in 2013?
- Does the FHFA see its focus on more significant deficiencies in the future?
- Are the GSEs modifying their representations and warranties?
- What will be the eligibility criteria for the new buyback protection?
- What will be the status of lender indemnification obligations to third-party claims?
- What are the exclusions to the life-of-loan reps and warrants?
- Will there be any new fees associated with the new buyback policies?
- Will the new rules distinguish between home-purchase and refinance loans?
- Will HAMP loans be eligible?
- Does the new initiative signal a GSE change of attitude toward lenders?
These Experts Share Their Insights and Answer Questions:
Director, Centralized Repurchase Team National Underwriting Center
Associate Director, House and Regulatory Policy
Vice President, Single Family Quality Control
Laurence E. Platt
Financial Services Practice Area Leader
K&L Gates LLP
CEO & Publisher
Inside Mortgage Finance